The process was supposed to make whole homeowners who had been wronged by the foreclosure fraud that was rampant in the midst of the housing crisis.
Instead, our Miami foreclosure lawyers realize that it made us all even more wary of the integrity of large financial institutions.
The Independent Foreclosure Review process has come under intense scrutiny by numerous media organizations, having spoken to some of those who were contracted by the banks to spot problems in reviewing hundreds of thousand of foreclosures, as requested by individual homeowners and overseen by the Office of the Comptroller of the Currency. The most recent investigative report comes from The Huffington Post, whose reporters spoke to five former reviewers.
These were individuals who were tapped to comb through the mortgages of those who were in foreclosure at the height of the scandal, in 2009 and 2010. In the midst of this process, these firms were supposed to be looking for some of the telltale signs of mismanagement and fraud – overcharges, lost paperwork and refusal to offer loan modifications.
Many of the reviewers, who may have at first believed they were working for the greater good, soon came to the conclusion that it was all set up.
For starters, those contracting with Bank of America had to answer literally thousands of questions per case. These questions seemed intentionally confusing and open to interpretation. But the banks offered default answers, which of course favored the financial institution, which the reviewers then had to change if they disagreed.
Additionally, the training offered to reviewers was spotty, at best. Mistakes were commonplace. And when the reviewers themselves pointed out obvious mistakes, managers at Bank of America urged them to turn a blind eye.
The five former reviewers interviewed by the Huffington Post said the cover-up went so far as bank managers telling them they would lose their jobs if their results tended to favor homeowners.
Although a recent $8.5 billion settlement that effectively ended the review process was characterized by the banks as a more effective way to serve homeowners’ interests, those on the inside say the deal was only reached because the banks realized they could no longer realistically justify the systematic errors that would have inevitably come to light sooner or later.
One reviewer, who had previously signed on with JP Morgan Chase, likened the reviews to a badly-designed ship that was fully intended to sink from the start. The reviews were being directly overseen by bank managers.
Perhaps the greatest fault lies with the Office of the Comptroller of the Currency, which failed to implement a mandated, consistent and truly independent process. These regulators also didn’t appear to even see that there was a problem until it had gone on so long that saving it was a lost cause.
When it all ended, the consultant firms had raked in more than $1.5 billion by billing anywhere from $230 to $630 an hour.
And for what?
We have to wonder how much good that money could have done in the hands of homeowners who were wronged in the first place.
If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Legal for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Mortgage Wars,” discussing foreclosure topics that matter to YOU.
Foreclosure Review Insiders Portray Massive Failure, Doomed From The Start, Jan. 14, 2013, By Ben Hallman and Eleazar David Melendez, Huffington Post
More Blog Entries:
Foreclosure Reviewer: “Independent” Reviews Were Rigged, Jan. 11, 2013, Miami Foreclosure Lawyer Blog